WrestleMania has come and gone. For wrestling fans, it's the time of year when new storylines finally end or just begin. For investors, it's an important time to zero in on World Wrestling Entertainment, Inc. WWE stock.
Shares opened sharply higher on Monday, recently trading up about 5 percent at $18.14. The company will host a conference call at 3 p.m. ET to discuss the financial impact of Wrestlemania and, most importantly, update everyone on the WWE Network subscriber count.
Update: The company announced 1.8 million subscribers, about 1.45 million of which are paid.
So, how has the stock traded since the Network debuted in February 2014? It's dropped an average of 20 percent during these calls.
Heading into the weekend of April 4, 2014, the stock closed a few cents above $28. Four days later, it was trading under $22 before plummeting the next month after the company's lower-than-anticipated cable TV deal.
Heading into the weekend of March 27, 2015, the stock closed around $16.50. Four days later, it was trading just above $14. Since that time, the stock is up about 20 percent.
As Jeff Macke summarized, "The WWE Network just over [two] years old and has about 1.4 million subscribers. That’s about 75% more subs than HBONow. Unlike HBO, WWE is banking everything on its own network. The company has completely abandoned the pay-per-view business model for monthly events. It’s all or nothing for WWE; either the network grows or the company has to shrink."
Macquarie's James Clement recently laid out four reasons to be concerned with the company and its stock in the post-Wrestlemania period. Meanwhile, Pacific Crest said WWE appears to be "well positioned to navigate the future of TV via its Internet-based direct-to-consumer network."
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